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5 Best Short-Term Business Loans 2020

Steve NicastroJune 17, 2020

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Online lenders provide short-term business loans starting at three months. Compare options for good- and bad-credit borrowers.

Short-term business loans can give your business the fast cash it needs to bridge cash-flow gaps, handle emergencies and other immediate financing needs, or take advantage of a business opportunity.

Think of them as quick-turnaround loans: Borrow what you can pay back relatively quickly so you can focus on running your business rather than managing debt.

Here are short-term financing options from online business lenders. We always recommend comparing small-business loans from multiple loan providers.

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Our picks for

Short-term lines of credit

Lines of credit are more flexible and generally have shorter repayment periods than short-term loans, making them more suitable for managing cash flow.

Kabbage - Line of credit

Kabbage - Line of credit

Est. APR

24.00 - 99.00%

Min. Credit Score

560

Pros

  • Financing up to $250,000 available within a few days.
  • Accepts low credit scores.

Cons

  • Rates are high compared to other online lenders.
  • Must have online checking or PayPal account to verify cash flow.
  • Fixed-fee structure means early repayment does not save interest.

Qualifications

  • Minimum credit score: 560.
  • Minimum time in business: 1 year.
  • Minimum annual revenue: $50,000.
Read full review
Kabbage provides fast loans for business owners with bad personal credit, but rates can be high.
Fundbox - Line of credit

Fundbox - Line of credit

Est. APR

10.10 - 79.80%

Min. Credit Score

550

Pros

  • Cash can be available by the next day.
  • Low minimum credit score requirement.

Cons

  • Rates are high compared to traditional banks.

Qualifications

  • Minimum credit score: 550.
  • Minimum time in business: 3 months.
  • Minimum annual revenue: $50,000.
Read full review
Fundbox offers a business line of credit to fill a cash-flow gap, and qualifying is easier than with other lenders.
BlueVine - Line of credit

BlueVine - Line of credit

Est. APR

15.00 - 78.00%

Min. Credit Score

650

Pros

  • Cash can be available within 12 to 24 hours.
  • Multiple products for different financing needs

Cons

  • Short repayment term results in higher payment amounts.
  • Requires personal guarantee.
  • Not available in North Dakota, South Dakota or Vermont.

Qualifications

  • 6-month line of credit
  • Minimum credit score: 650.
  • Minimum time in business: 36 months.
  • Minimum annual revenue: $100,000.
  • 12-month line of credit
  • Minimum credit score: 650.
  • Minimum time in business: 3 years.
  • Minimum annual revenue: $480,000.
Read full review
BlueVine's line of credit provides fast working capital for short-term borrowing needs.

Our pick for

Short-term business loans for fast cash

Business loans are term loans that provide a lump of cash upfront, repaid over a set period of time with fixed, equal payments.

OnDeck - Online term loan

OnDeck - Online term loan

Est. APR

9.00 - 99.00%

Min. Credit Score

600

Pros

  • Cash can be available within the same business day.
  • Requires low minimum credit score.
  • Less paperwork than most lenders.

Cons

  • Fixed-fee structure means early repayment will not save interest.
  • Requires frequent (daily or weekly) repayments.
  • Requires business lien and personal guarantee.

Qualifications

  • Minimum credit score: 600.
  • Minimum time in business: 3 years.
  • Minimum annual revenue: $250,000.
  • No bankruptcies in the past 2 years.
Read full review
OnDeck offers a fast term loan for small-business owners with less-than-stellar credit who want to expand.

Our pick for

Short-term business loans for low rates

Credibility Capital - Online term loan

Credibility Capital - Online term loan

Est. APR

19.99 - 24.99%

Min. Credit Score

680

Pros

  • Competitive rates among online lenders.
  • No prepayment penalty.
  • Extra monthly payments can save interest cost.

Cons

  • Short repayment term results in higher payment amounts.
  • Requires high minimum credit score and revenue.
  • Requires business lien and may require personal guarantee.
  • Not available in Nevada, North Dakota, South Dakota, or Vermont.

Qualifications

  • Minimum credit score: 680.
  • Minimum time in business: 2 years.
  • Minimum annual revenue: $250,000.
  • No bankruptcies in the past 5 years.
Read full review
Credibility Capital offers low-cost business loans that work best for small-business owners with strong credit.

Easily get real, personalized small business loan rates to compare — not just ranges or estimates.

It’s free and won’t affect your credit.

Get Started

on Lendio's website

Summary of Best Short-Term Business Loans 2020

Pitfalls of short-term loans

While short-term business loans provide fast cash, they do come with some disadvantages, including:

  • Higher cost: Short-term business loans typically carry a higher annual percentage rate, or APR, than long-term loans. Use NerdWallet’s business loan calculator to figure out how much a loan will cost you.

  • More frequent repayments:Some lenders require payments daily or weekly as opposed to monthly. Although these payments are smaller, their frequency can be an issue for businesses that have uneven sales or don’t always hold much cash in a bank account.

  • Risk of debt trap: The speed and ease of short-term business loans can become addictive. Instead of repaying the debt in full, business owners may be enticed to refinance and roll over the debt into a new loan.

Compare small-business loans

NerdWallet has created a comparison tool of the best small-business loans to meet your needs and goals. We gauged factors including lender trustworthiness, market scope and user experience, and arranged them by categories that include revenue and how long you’ve been in business.

Last updated on June 18, 2020

To recap our selections...

NerdWallet's Best Short-Term Business Loans 2020